Legal

The perils of a flexible working ban

2 Apr 2019 By Harry Abrams

What is the possible fallout of an employer prohibiting flexible working, as BNY Mellon recently proposed? Harry Abrams reports

One-third of UK workers would prefer flexible working to a pay rise, according to a recent survey by powwownow.co.uk, while 75 per cent stressed the importance of employers permitting flexible working. Employers across all industries are now recognising the need to offer agile working as standard. 

If they fail to do so, they risk losing their existing staff, as well as failing to attract new employees. This may prove to be the case for BNY Mellon, which has been in the news recently following its proposed ban on working from home.

As soon as BNY Mellon’s chief executive Charles Scharf’s proposal was leaked publicly, he performed a dramatic U-turn. Within 24 hours of the Evening Standard exposing the proposals, Scharf confirmed that the company had “immediately hit pause”. Despite the U-turn, the long-term damage may have already been done. The initial proposal is likely to cause a perception that the company is wildly out of touch and not employee-friendly. 

Indirect discrimination

Any ‘blanket ban’ approach can indirectly discriminate against certain sectors of the workforce. While a proposal may apply to all employees, those who have childcare arrangements or need to work from home on occasion due to a disability are impacted more severely than others. Any indirect discrimination can be defended if the policy is ‘objectively justified’.

As discrimination claims are open to job applicants as well as current employees, it is possible that if an applicant is rejected by a company that rejects flexible working, they may argue it was due to their desire to work flexibly rather than any merit-based reason. The business could also receive data subject access requests from prospective employees who are trying to obtain the real reasons for their rejection. The same applies to any current employees who are aware of the view the business has on flexible working.

If a flexible working request is agreed to by an employer, it is a permanent change to the employee’s contract of employment. By proposing to ban all flexible working, a company is, in essence, proposing a unilateral change for those employees who already had a contractual right to work flexibly. If the proposal progressed, the employees would be unlikely to mutually agree to vary their contracts, leaving their employer to either unilaterally impose the change or offer to terminate and re-engage on new terms and conditions – terms that would have confirmed office-based work only. Either of these options could open the company up to significant liability in respect to breach of contract claims and/or unfair dismissal claims.

Varying working arrangements

For employers to vary employees’ working arrangements, they should ideally consult with the workforce, explaining to them the reasons for the changes being proposed. For those that resist the change, the employer may have no choice but to dismiss and re-engage with the hope of justifying the dismissal by claiming that it is fair under “some other substantial reason.” 

More specifically, the employee’s refusal to accept changes to terms and conditions justifies the decision to dismiss. The employer’s approach to implementing the change and the reasons for it will be the determining factor as to whether this outlined approach will be deemed as ‘fair’.

An employee faced with such proposals must weigh up their options, which will include (i) accepting the change; (ii) resigning during the consultation (if any) and claiming constructive unfair dismissal; or (iii) working ‘under protest’.

Harry Abrams is a solicitor at Seddons

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